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Freelancers vs. Software Development Agency

26 June 2023
Freelancers vs. Software Development Agency

When embarking on a software development project, one critical decision you'll face is whether to work with freelance developers or partner with a software development agency. Each option has its own set of advantages and drawbacks. But the ultimate decision will depend on your project budget, complexity, and overall requirements.

In this article, we'll explore the distinctions between freelance software developers and agencies to help you choose the most suitable option for your unique needs.

The Difference Between a Freelancer and a Company

Since we’ve become increasingly dependent on technology, the demand for quality software has skyrocketed. This has led to a surge in the number of developers in the market, with two main options for companies looking to hire software developers: a freelance software developer or a development agency.

And there are significant differences in what each can offer.

***Freelance software developers are individual professionals who work for themselves and cater to one or several clients at a time. They are typically experts in their field, possessing specific skills and knowledge that allow them to complete jobs independently. ***

***On the other hand, development agencies are companies that specialize in software development and offer a range of services to their clients. These services can include everything from software design and development to quality assurance testing, maintenance, and support. ***

One of the primary differences between these two options is the level of expertise offered. Freelance developers tend to be more specialized in certain areas and have a strong understanding of specific technologies. In contrast, development agencies often have broader expertise and can handle a more comprehensive range of projects.

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Source: Upwork

In 2019, 45% of independent contractors said they provided some expert services besides freelancing. This indicates that independent contractors operate in the IT, marketing, business consulting, writing, design, and computer programming industries. But in 2021, it was discovered that the proportion of independent contractors offering skilled services has increased to 53%, an 8 percentage point rise in the previous two years.

Another difference is the level of supervision required. ***Freelance developers work independently and are typically hired for a specific project. Meanwhile, development agencies tend to have a more structured process, including team members who work together to complete a project. ***

Finally, the cost and flexibility of these options are different. ***Freelance developers can be more flexible with their pricing and offer more competitive rates, while development agencies may have higher costs but offer more stability and resources. ***

There are also several determining factors on the side of your company.

Project's Specifications

First and foremost, the size and duration of your project play a significant role in determining whether to hire a software development agency or a freelancer. A large project with a long timeline requires a team with diverse skills and expertise to handle different aspects of the project effectively. In this case, a software development agency is the better option as they have a team of developers, designers, project managers, and other professionals that can take care of your project's various needs.

In contrast, a small project with a short timeline may only require one or two developers to complete. In this case, a freelancer might be a better choice as they may be more cost-effective and can work on the project part-time or full-time.

Additionally, if the project requires specialized skill sets, such as machine learning or artificial intelligence, a software development agency may be the better choice as they have a pool of experts with specialized knowledge. However, a freelancer with niche expertise may also be able to handle such projects.


Your budget is another critical factor to consider. Hiring a software development agency usually requires a higher budget as they have more overhead costs and a team to pay. A freelancer may be a cheaper option as they have fewer expenses to cover.

Business Culture

Lastly, your company's business culture should also influence your decision. Some companies prefer working with software development agencies because they offer a more established project management and delivery approach. Others prefer working with freelancers as they may have more flexibility and can quickly adapt to changes in project requirements.

In the end, each option has its pros and cons. Freelancermap conveniently listed them in one image, and it's the perfect illustration for those having a hard time deciding between the two.

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Freelance vs. Software Agency: Top Aspects to Consider

Consider the following aspects choosing between a freelance vs software company.

  1. Process: Software development is a complex and often multi-faceted process with numerous stages and moving parts. Choosing a freelancer for a small project is good, but if you have a large-scale solution to develop this can often mean sacrificing a structured process, as freelancers tend to work in a more fluid and personalized manner. Agencies, however, typically have a more regimented process and are better equipped to tackle large-scale projects with numerous stakeholders.

  2. Accountability: When working with a freelancer, accountability can often be a hit or miss. While some freelancers are incredibly reliable and dedicated to their work, others may have different commitments to deadlines or responsiveness. Software development agencies, on the other hand, tend to have more formalized contracts and expectations for accountability, making them a more dependable choice.

  3. Quality: The quality of work is a crucial factor in any software development project and one that should not be taken lightly. Choosing a freelancer means that you'll need to thoroughly vet their skills and experience, as well as their portfolio of work. While there are undoubtedly highly skilled freelancers out there, it can be challenging to identify them amidst a sea of less experienced individuals. That same concerns the agencies - there’s a vast sea of companies offering development services. While they often have a team of experts with diverse skill sets, you still have to do your due diligence while choosing the one ideal for your needs.

  4. Reliability: Nothing is worse than being left in the lurch midway through a project. Freelancers can be susceptible to unexpected circumstances that can interfere with their ability to work on a project. In contrast, software development agencies are typically more equipped to handle any issues that may arise.

  5. Scalability: When it comes to software development, scalability is a critical consideration. The requirements of your project may change over time, and you need to ensure that your chosen development partner can adapt as needed. Freelancers may not have the bandwidth or support required to handle larger projects or a sudden surge in requirements. Conversely, software development agencies often have a larger team or network of experts, which makes scaling up or down much easier.

  6. Support: Software development doesn't end once the project is complete - ongoing support and maintenance are critical for ensuring the product's long-term success. Not all freelancers are equipped to provide the same level of support over the long haul. Most software development agencies, however, typically have dedicated support teams to help clients navigate any issues or bugs.

  7. Security: The security of your software product is another paramount consideration. Freelancers may not have dedicated security protocols or the same level of end-to-end encryption and protection that a software development agency can offer. It's essential to ensure that any development partner you choose has robust security measures in place to protect your product and any associated data.

When to Hire a Freelancer

Freelancers are becoming increasingly popular due to their flexibility, affordability, and diverse skill set. Here are some critical factors that determine when it is best to choose a freelance software developer for a project:

  1. Firstly, projects with tight budgets often find solace in hiring freelance developers. These independent contractors tend to offer services at considerably lower rates than an established software development company. Furthermore, their flexible payment models mean companies can negotiate billing arrangements that suit their financial capabilities.
  2. Secondly, freelance developers can be a great choice where a specific skill set is required. They are known for their diverse expertise across various programming languages and development systems. Consequently, they adapt more to projects requiring a customized development approach and offer unique solutions to complex problems.
  3. Thirdly, freelance developers provide an excellent resource for start-ups or small businesses looking to make their mark in the technological world. These entities often need more resources to hire a full-time software development professional. Thus, hiring a freelance developer is an excellent way to meet tight deadlines, get high-quality work, and maintain short-to-medium project timelines.
  4. Lastly, freelance developers' nimble approach to working means that they are best suited for dynamic projects with numerous changes and high levels of adaptation. They ensure that projects are not locked in the development stage, especially when the requirements are continually evolving. Freelancers are not constrained by the internal protocols of an established software company, so they can easily integrate new solutions and adjust to the dynamic needs of the project.

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When to Hire a Software Agency

When it comes to software development, there are a variety of reasons why you may want to bring on a development agency to help you bring your project to life. With the right agency in your corner, you can get access to the expertise, resources, and tools that are necessary to build and launch your software application successfully.

  1. One of the key reasons why you may choose to work with a software development agency is if you lack the in-house resources or expertise necessary to bring your project to life. For example, if you are a startup or a small business and need a dedicated team of developers, bringing on an agency can be a great way to fill that gap and ensure your project is completed on time and within budget.
  2. Another reason why you may choose to work with a software development agency is if you need specialized expertise that is only available in some places. For example, if you are building a complex application that requires knowledge of a specific programming language or technology stack, then a development agency with experience in that area can be extremely valuable.
  3. Finally, a software development agency can be a great choice if you need to scale up your development efforts to meet tight deadlines or respond to rapidly changing market conditions. With a development agency in your corner, you can quickly access the resources and skills you need to keep your project moving forward at the pace you require.

Which One Is Ideal For Your Business?

There are benefits and drawbacks to both agency and freelance development. We decided to help you choose by providing a few circumstances in which one of them will be great for a business, even though there has yet to be a clear-cut recommendation for who you should engage.

For the following purposes, you may use independent contractors:

  • making progress on a modest or nearly finished project
  • low-cost projects
  • highly specialized positions
  • projects that demand a lot of your time and effort.

A software development company can be used for:

  • projects requiring specialized knowledge
  • large-scale, intricate projects
  • medium- to high-budget projects
  • superior-quality projects.

While freelance software developers may not be the ultimate solution for all projects, they offer significant advantages in budgeting, skillset, and flexibility. If you lack in-house resources or expertise, need specialized knowledge, or require rapid scaling of your development efforts, then an agency can be an excellent choice for your project.

Final Word

In summary, both freelance software developers and development agencies have their own distinct advantages. Freelancers provide specialized expertise and flexibility while development agencies offer broader expertise and a more structured process. Both options come with their own unique set of strengths and weaknesses, and it's crucial to weigh them against the specific needs of your project. Ultimately, companies should choose the option that best aligns with their specific needs and priorities.

If you want to ensure that your software application is a success, we can provide you with a dedicated software development team of experts to focus on your project! Clover Dymanics is a software development outsourcing company with expertise in various niches (RTC, fintech, e-commerce) and advanced technologies (AI, ML).

Let’s talk and see what we can bring to your table!

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